Linked by Thom Holwerda on Sat 28th Jul 2012 10:10 UTC
PDAs, Cellphones, Wireless In case you were still doubting whether or not Apple's lawsuits against Samsung were a case of 'if you can't compete, litigate', Samsung's financial results should seal the deal. The company shipped round and about 50 million smartphones, twice as many smartphones as Apple shipped. So, not only is Android doing better on smartphones than iOS, there's now also a single manufacturer outselling Apple. Oh, the next avenue for de-emphasizing this achievement has already reared its head: Samsung has a wider portfolio, and as such, the comparison isn't fair. Nonsense, of course - Volkswagen sells lots more models than, say, Mazda, but that doesn't mean you can't compare them. Maybe, just maybe, having a wide portfolio of devices to meet the various different needs of the market is simply a very good strategy. It'll be interesting to see just how much Apple can take back with the next iPhone, especially since the full potential of the Galaxy SIII hasn't been realised yet and will be accounted for in Samsung's next quarter as well. Fun, such a fight between titans. Just too bad one of the two titans plays dirty by opting for the courtroom.
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RE: History will repeat itself...
by tanzam75 on Sat 28th Jul 2012 15:26 UTC in reply to "History will repeat itself..."
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iPhone has gotten an immense boost in the US from the higher carrier subsidies given to it, vs. Android phones. When you can buy a $600 iPhone for $200, and a $400 Android phone for $200, then Apple gets the benefit of the doubt.

At some point, Android phones will have enough market share -- even in the US -- that the iPhone subsidy will no longer be justified. If a $600 iPhone sells for $400, and a $400 Android phone sells for $200, then a lot of iPhone users will think twice about upgrading.

And then, there's the possibility that carriers will eventually eliminate subsidies. The current Verizon CEO has publicly spoken about the need to eliminate subsidies -- something that no previous Verizon CEO has ever stated publicly before. And T-Mobile has always been very grumpy at being forced by the other three carriers to play the subsidy game.

$600 vs. $400 presents a smaller relative price difference, but $600 will cause consumers who are used to $200 iPhones to reel from sticker stock. In addition, a deferred upgrade is just as bad for Apple as a sale lost to Samsung.

In other words, Apple has relentlessly maximized its profits under the current market structure -- just like they did back in the late 1980s, when the price of a Mac gave you a nosebleed. But they're not considering what is sustainable over the long run, after the market structure changes.

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